April Consumer Confidence Hits 14-month High, USD Pares Loss
By Trang Nguyen,
THE TAKEAWAY: April U. of Michigan Confidence Final Index Rose to 76.4 > Americans Appeared Optimistic about the State of the Economy > USD Pares Loss vs. Most of its Major Peers
Confidence among U.S. consumers hit fourteen-month high in April , reflecting their optimism about the prospective strength of the economy and rising expectations on business conditions, employment and income. The Thomson Reuters/ University of Michigan final index mounted to 75.3 in April , just ahead of 76.2 in March and substantially above last April’s 69.8. The figure topped the consensus forecast as sixty -one economists surveyed by Bloomberg News anticipated the print of 7 5.7 that was unchanged from a preliminary reading.
The increase in confidence over the past six months has been substantial, with the Sentiment Index climbing above the recession average of 69.3 but still well below the average of 88.1 for non-recessionary periods . Potential job gains and faster payroll growth contributed to the gain in consumer sentiment this month. E conomic outlook index climbed to 72.3 from 70.3 while economic conditions index for April declined to 82.9 from 86.0 in March. Additionally, i nflation expectations for one year ahead sharply fell to 3.2 percent this month from 3.9 percent in the previous month while the figure for five years ahead also cooled down to 2.9 percent from 3.0 percent in March . Price pressure eased this month due to falling gasoline costs.
USDCAD 1-minute Chart: April 27 , 2012
Chart created using Strategy Trader – Prepared by Trang Nguyen
The U.S. dollar tumbled versus most of its major counterparts after the dismal Gross Domestic Product report released at 8:30 A.M. EST today. The world’s largest economy unexpectedly expanded at annual pace of 2.2 percent in the first quarter of 2012 compared to 2.5 percent predicted and 3.0 percent in the previous quarter. However, the reserve currency immediately pared loss versus most of its major peers in the m inutes following the better-than- projected consumer sentiment report . As seen from the 1-minute USD CAD chart above, the greenback edged up 20 pips from C$0.9805 to C$0.9825 within thirty minutes.
--- Written by Trang Nguyen, DailyFX Research Team for DailyFX.com
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